Chevron Locks In More LNG From Energy Transfer's Lake Charles Project

Energy Transfer LP (NYSE:ET) on Wednesday announced an expanded liquefied natural gas (LNG) supply agreement with Chevron U.S.A. Inc., a wholly owned subsidiary of Chevron Corporation (NYSE:CVX), strengthening their long-term energy partnership.

The new 20-year deal adds 1 million tonnes per annum (mtpa) to Chevron’s existing commitment, bringing the total to 3 mtpa.

The LNG will be delivered from Energy Transfer’s planned Lake Charles export facility on a free-on-board basis, with pricing tied to a fixed liquefaction charge and a variable component indexed to Henry Hub gas prices.

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The agreement is contingent on a final investment decision and other conditions being met.

Energy Transfer LNG President Tom Mason called the deal a “significant milestone” in their collaboration with Chevron. Freeman Shaheen, President of Chevron Global Gas, said the expanded supply reflects the company’s strategy to offer “affordable, reliable, and ever-cleaner energy.”

The Lake Charles project continues to build momentum, having already secured long-term commitments such as a 5 mtpa Heads of Agreement with MidOcean Energy and a 1 mtpa Sale and Purchase Agreement with Kyushu Electric Power Company.

The facility will leverage existing infrastructure at a former regasification site, including LNG tanks, deepwater berths, and access to major natural gas basins like the Permian and Marcellus.

Price Action: ET shares were trading lower by 0.11% to $17.65 on Wednesday’s last check.

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